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FERC Acts on Business Standards for Gas Pipelines, Electric Utilities

FERC last Wednesday approved revised standards governing business practices and electronic communications for interstate natural gas pipelines, as well as issued a proposed rule to adopt similar standards for electric utilities for the first time.

The final rule for gas pipelines spells out standards for natural gas quality reporting, creditworthiness criteria and other practices. The regulations adopt the most recent version of standards developed by the Wholesale Gas Quadrant (WEQ) of the standards-setting organization, the North American Energy Standards Board (NAESB).

On the issue of creditworthiness, the new regulations outline the standard procedures for business practices that pipelines must follow when requesting additional information from potential shippers for credit evaluation; acknowledging and responding to requests and receipt of shipper information; issuing a notice regarding a shipper's creditworthiness and a notice of contract termination due to credit-related issues; forms of communication; reevaluating determinations that a service requester is not creditworthy; and awarding capacity-release offers only after a service requester has been deemed to meet the creditworthiness requirements applicable to all services [RM96-1-026].

The standards on gas quality reporting will require pipelines to provide a link to their gas quality tariff provisions on their Informational Posting Web Sites, or a simple reference guide to the information, according to FERC.

In addition, the final rule calls on pipelines to post on their Informational Posting Web Sites daily average gas quality information for prior days, to the extent available for locations that are representative of mainline gas flow for the most recent three-month period.

Interstate pipes will be required to file tariff sheets reflecting the new standards by July 1 of this year in order for the standards to take effect by Sept. 1, the Commission said.

In a notice of proposed rulemaking (NOPR), FERC last Wednesday proposed the first set of standards for business practices for electric utilities. The standards include Open Access Same Time Information System (OASIS) business practice standards, and OASIS communications protocols.

Specifically, the agency proposes to incorporate procedures to address the redirect of transmission service (unless there is a conflict with provisions of the utility's pro forma tariff), multiple submissions of identical transmission requests/queuing issues, OASIS posting requirements under the Commission's large generator interconnection rule (Order 2003), and maintenance of the OASIS standards.

FERC also proposed to incorporate the WEQ business practice standards that are designed to complement the North American Electric Reliability Council's Version 0 reliability standards. As with the gas pipelines, the Commission will require that each electric utility's open-access transmission tariff include the applicable WEQ standards.

Comments on the NOPR [RM05-5] must be submitted to FERC within 45 days from the date of the NOPR's publication in the Federal Register.

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